Tip: You don't need to remove the key and key cylinder to remove the locking mechanism. It's very tight, but a little twisting and it comes right out.
If you do want to remove the key and the black ring , when you turn it counterclockwise, give the black ring a little tug at the same time. Mine would not simply turn counterclockwise until I pulled a little bit.

I have mine out now and it seems to work fine outside the car. I'm going to add some white grease to the mechanism as best as possible to see if I can reinstall it without having to grind down the end. Btw - the picktures that show the mechanism and where to cut - are right. It's not a pin inside that needs to be cut down, but the whole housing. Just taking off 1/4 to 1/2 inch should do it.

I'll post later today if the white grease does the trick.

Note: I called Brumos Mercedes of Jacksonville FL - they have one in stock for $157 + tax. If all else fails, I'll go get that one.